Oklahoma voluntary compliance initiative : "Clean slate 08" /

T 500.3 V943c 2009 c.l
Oklahoma
Voluntary Compliance Initiative
"CLEAN SLATE 08"
Final Report
Submitted by the Oklahoma Tax Commission
Tuesday, January 20, 2009
OKLAHOMA VOLUNTARY COMPLIANCE INITIATIVE
CLEAN SLATE '08
FINAL REPORT
TABLE OF CONTENTS
EXECUTIVE SUMMARY 3
Planning 6
Delinquent Accounts 6
Collection Agencies 6
Customer Service 7
LEGISLATIVE HISTORY 4
RESEARCH AND STRATEGIC PLANNING 5
IMPLEMENTATION 6
Public Relations 7
INITIA TIVE OUTCOMES AND RESUL TS 8
Taxpayer Interest 8
Collections During the Initiative 9
Payment Plans 9
Collections by Tax Type 10
Clean Slate '08 Participation 10
Collections by State 11
Collections by Tax Period 13
Settlement of Legal Cases 14
Implementation Costs 14
APPENDIX A
Section 1 of Enrolled House Bill 2034 15
APPENDIXB
Oklahoma Tax Commission Emergency Rules .17
APPENDIXC
Clean Slate '08 Frequently Asked Questions .21
2
EXECUTIVE SUMMARY
The collection of taxes is essential to provide revenue for general and specific functions of state
government. The non-payment of state taxes impedes the funding of these governmental
functions. In an effort to assist the Oklahoma Tax Commission in collecting delinquent tax
liabilities, Governor Brad Henry signed legislation into law on June 3, 2008 authorizing a
voluntary tax compliance initiative. The purpose of the initiative was to collect tax delinquencies
through a waiver of penalties and interest. The initiative began September 15, 2008 and ended
November 14, 2008.
The initiative, known as Clean Slate '08, was well received by the public and was an
overwhelming success.
During the initiative (Sept. 15 through Nov. 14), the Oklahoma Tax Commission collected
approximately $91 million. The Tax Commission received promises to pay, through payment
plans, of an additional $37 million on or before June 15, 2009. Therefore, total collections for the
initiative could reach as high as $128 million. As of December 31, 2008, the Tax Commission
has collected an additional $24 million from these payment plans. Therefore, the total collections
for the initiative, to date, are $115 million. The initiative was originally estimated to add an,
additional $34 million to the state coffers.
The success of the program can be traced to the dedication and contributions of the employees of
the Tax Commission. Tax Commission personnel were actively involved in developing and
implementing all aspects of the program. These duties included planning operations, researching
tax accounts, educating taxpayers, processing payments, providing technological tools, and
focusing on customer service. This unified effort resulted in collections that more than tripled the
original estimate. The commitment was not only made by those employees working directly on
the initiative, but also came from employees agency-wide working to ensure the other functions
of the agency were met during this time.
While the program has officially ended, there is still work to be done. The Tax Commission
continues working with taxpayers who entered into payment plan arrangements during the
initiative. The Tax Commission will also be working to collect taxes from the citizens that were
eligible for, but did not participate in, the initiative or who may default on the payment plans.
The Tax Commission has now entered into a partnership to identify and locate citizens who have
not fulfilled their responsibilities to pay their taxes due and owing to the State.
The following report provides an overview of the initiative and its results.
3
LEGISLATIVE HISTORY
Enrolled Senate Bill 2034, authored by Sens. Mike Mazzei and Jim Wilson of the Senate and
Rep. Randy Terrill of the House, was signed by Gov. Brad Henry on June 3, 2008. For the
"purpose of encouraging the voluntary disclosure and payment of taxes owed to the state",
Section 1 of the legislation authorized and directed the Oklahoma Tax Commission to establish a
voluntary compliance initiative for eligible taxes (see Appendix A).
The legislation further provided that the Tax Commission was to establish the voluntary
compliance initiative for all "eligible taxes" during the period of September 15, 2008 through
November 14,2008. The "eligible taxes" included:
1. Gasoline and diesel taxes,
2. Franchise tax,
3. Gross Production and petroleum excise taxes,
4. Corporate Income tax,
5. Bank "in lieu" taxes,
6. Individual Income tax,
7. Withholding taxes,
8. Sales and Use taxes, and
9. Mixed Beverage taxes.
Taxpayers who remitted eligible taxes through the initiative would receive a full waiver of
penalty, interest and any other collection fees. The legislation provided that the taxpayer will be
deemed to have "paid" the tax if the tax is paid in full or complies in full with a payment plan
agreement established through the initiative. To be eligible for the waiver, the taxes had to be due
and payable for a taxable period ending on or before December 31, 2007.
The legislation further provided that if an eligible taxpayer fails to take advantage of the
initiative, an additional penalty equal to the original penalty will be assessed. The double penalty
provision does not apply if the taxpayer was not eligible to participate in the initiative or the
taxpayer timely filed a protest of an assessment or otherwise contested the matter before a court
of competent jurisdiction.
The Tax Commission was given authority to expend funds to contract with third parties to
publicly advertise, assist in the collection of eligible taxes, and administer the initiative. The Tax
Commission was also given authority to promulgate rules to carry out the initiative. The rules
were adopted in emergency form on July 8, 2008 (see Appendix B).
4
RESEARCH AND STRATEGIC PLANNING
Prior to implementation, the Administrator appointed an internal leadership team, co-project
managers, and five process teams (Communications, Taxpayer Outreach, Operations, Procedures,
and Technology). The teams and their assigned responsibilities were as follows:
Leadership Team - consisted of the Agency Administrator, Deputy Administrators,
Comptroller, Counselor to the Commissioners, and Co-Project Managers. The team's
responsibilities included the business plan, infrastructure needs, budget oversight, contract
administration, schedule tracking, and ongoing reports.
Communications Team - led by the Communications Division Director and consisted of
members of the following divisions: Taxpayer Assistance, Account Maintenance, Tax Policy and
Information Technology. The team's responsibilities included public relations, media buys and
placement, forms development, press releases, web design, speaking presentations, and outreach
letters.
Procedures Team - led by the Tax Policy Division Director and consisted of members of the
following divisions: Tax Policy, General Counsel's Office, Communications, and Information
Technology. The team's responsibilities included rule promulgation, written procedures, FAQ
Development, and Legislative LiaisonlInformation.
Technology Team - led by the Information Technology Division Director and consisted of
members of the following divisions: Information Technology, Account' Maintenance,
Compliance, and Tax Policy. The team's responsibilities included systems development, data
gathering (taxpayer and account identification), and data analysis.
Operations Team - led by the Account Maintenance Division Director and consisted of
members of the following divisions: Account Maintenance, Central Processing, Taxpayer
Assistance, Compliance, Information Technology, General Counsel's Office, and Management
Services. The team's responsibilities included return and payment processing, revenue allocation,
payment plan administration, warrant releases, printing and mailing, returned mail, and backlog
reduction.
Taxpayer Outreach Team - led by the Taxpayer Assistance Division Director and consisted of
members of the following divisions: Taxpayer Assistance, Compliance, Account Maintenance,
and Human Resources. The team's responsibilities included customer service training,
telephones, walk-ins, system training, and district office assistance.
5
IMPLEMENTATION
Planning - The implementation of the Voluntary Compliance Initiative began with a focus on
identifying delinquent taxpayers, communicating directly with those. delinquent taxpayers,
publicizing the initiative, training employees on all aspects of the initiative, and providing the
best customer service to taxpayers taking advantage of the initiative. It was from this focus that
the assignments were made to the process teams.
Delinquent Accounts - The first step was to identify all the delinquent taxpayers and quantify
the dollar amount of unpaid tax debts. These debts included all outstanding tax liabilities for the
eligible taxes due for periods ending on or before December 31, 2007. This effort identified
253,000 delinquent taxpayers who owed a total of $481 million to the State of Oklahoma.
Collection Agencies - It was decided that contracting with an outside collection agency was
essential to provide the outreach necessary to attain the desired results. The Tax Commission had
existing contracts with two outside collection agencies. Those agencies continued to work on
their active accounts during the initiative. The Tax Commission entered into a contract with a
third collection agency, General Revenue Corporation (GRC), to assist in reaching all other
taxpayers and provide debt collection services specifically for the initiative.
The GRC contract agreement included:
• Segmentation and Prioritization of Accounts - Using its own resources, GRC created a
data warehouse team for the purpose of creating and supporting a data warehouse process
unique to the requirements and needs of the Oklahoma Tax Commission. GRC divided
the accounts into four sub-groups (in-state individual, out-of-state individual, in-state
business, and out-of-state business).
• Targeted Mailings - GRC sent a series of scheduled mailings especially tailored to each
sub-group. An initial informational letter was followed by a second letter advising of
consequences for non-compliance with the initiative, and subsequent letters as needed.
For all sub-groups, the initial informational letter was followed by a targeted outbound
phone campaign. These targeted mailings resulted in 330,618 letters mailed out to
delinquent taxpayers.
• Inbound and Outbound Phone Campaign - GRC fielded inbound calls and made
targeted, auto-dialed outbound calls related to the initiative. The phone campaign hours of
operation extended beyond the Tax Commission's normal business hours, operating
from:
o 8:00 am - 9:00 pm Monday through Friday
o 8:00 am - 8:00 pm Saturday
This extended availability resulted in answering 129,157 inbound calls and placing
615,315 outbound calls. Tax Commission employees answered an additional 79,531 calls
placed to its offices in addition to the calls answered by GRC.
• Skip-Tracing Efforts - GRC utilized a skip-tracing process to handle all returned mail
and locate delinquent taxpayers. Upon receipt of returned mail, GRC completed a skip-trace
program to locate a viable address. GRC will return the accounts with any updated
contact information to the Tax Commission for use in future compliance efforts.
6
Customer Service - For taxpayer convenience, a special toll-free number was established for
incoming calls. In addition, a special page on the Tax Commission's website was dedicated to
provide initiative information. An initiative e-mail address was established for taxpayer e-mail
questions and correspondence.
Customer-service training was also provided to employees dealing with taxpayers. Additionally,
the Tax Commission offered extended customer service hours at its main office during the last
week of the initiative.
An extensive FAQ (Frequently Asked Questions) was posted on the web site to provide quick
and easy answers to questions for the general public. A copy of the FAQs is attached as Exhibit
C.
Public Relations - Communicating with the public was essential for the initiative to be
successful. With funding provided by the Legislature, the Tax Commission entered into a
contract with Jordan and Associates, an advertising and marketing firm, to design, develop and
implement a multi-media campaign that used a combination of approaches, strategically
implemented, over a 10-week period to promote participation in the initiative on a state-wide
basis.
The contract required the firm to develop and produce at least one 30-second television
commercial, one 60-second radio commercial, one printed piece for mailing, one billing stuffer
piece/postcard, a newspaper ad for several state publications, State Fair publication, all media
purchases, media packets and planning, and to provide kick -off event press conference
assistance. The firm also provided a slogan to tie the campaign together. The slogan decided
upon was Clean Slate '08.
The advertising campaign resulted in the following:
• The television commercial ran 639 times in September, 555 times in October, and 165
times in November for a total of 1,359 times in the Oklahoma City, Tulsa, Sherman, TX,
and Ada markets.
• The radio commercial ran a total of 1,492 times in November in Oklahoma City, Tulsa,
Lawton, and other outlying markets.
• Articles and interviews ran in more than 150 Oklahoma newspapers (including daily and
weekly publications).
• Online advertising (webvertising) began September 15. The largest of these web ads were
in the form of web banner ad placements on NewsOK.com and TulsaWorld.com. The
banners appeared 423,561 times on the NewsOK site and 217,000 on the TulsaWorld
site.
• The Tax Commission also received additional advertising from promotional spots placed
on the television, radio, and the internet at no cost to the agency.
• Numerous speaking engagements presented information on Clean Slate '08 including
engagements at the Western Oklahoma Society of Accountants, Tulsa Small Business
Forum, County Assessors Conference, Enrolled Agents Seminar, El Reno Main Street
Program, Tulsa Society of Certified Public Accountants, Oklahoma Black Chamber of
Commerce, and Tax Commission New Business Workshops.
7
Clean Slate '08 Taxpayer Contacts
INITIATIVE OUTCOMES AND RESULTS
Taxpayer Interest - The Tax Commission experienced a great interest in the initiative from the
public. From September 15 through November 14, 2008, in addition to the incoming calls
detailed earlier in this report, more than 7,100 taxpayers visited the Tax Commission's main
office and district office locations, and more than 2,100 taxpayers contacted the Tax Commission
via email about the initiative.
Oklahoma's initiative followed the pattern of most other tax amnesty programs, in that many
taxpayers waited until the final two days of the amnesty period to take advantage of the program.
Almost half of the walk-ins visited the Commission's offices during the final two days of the
initiative.
The chart below details the contacts made by taxpayers and the Tax Commission's outreach
efforts during the initiative.
..' " ,:';\ ;..
~ 7,199
,
330,61f
• 2,114 ,~
615,315
208,688
I
I I
10'0,000 200,000 300,000 400,000
Number of Contacts
500,000 600,oqO· 700,0(JO
8
Collections During the Initiative - Payments actually made during the initiative totaled
$90,931,944. The chart below illustrates the dates that the payments were made. As illustrated
below, approximately 46% of the collections are attributable to payments made during the final
week of the initiative.
Collections During Clean Slate '08
$45,000,000 $41,974,825
$5,000,000
$40,000,000
$35,000,000
$30,000,000
'C•• .t!!i! $25,000,000
'0 o~
$20,000,000
.!!!
'0
Cl
$15,000,000
$10,000,000
$91,682 $330,508
9/19/2008 9/26/2008 10/3/2008 10/10/2008 10/17/2008 10/24/2008 10/31/2008 111712008 11/14/2008
Week Ending
Payment Plans - A total of approximately 11,500 payment plans were entered into during the
initiative wherein taxpayers promised to pay approximately $37,038,101 by June 15,2009. Those
taxpayers who successfully complete their payment plans will receive the full benefit of the
initiative and receive a waiver of all penalties and interest and other collection fees.
9
Collections by Tax Type - A total of ten (10) different tax types were included in the initiative.
Individual income taxes yielded the most money and number of payments during the initiative. A
breakdown of the number of payments and amount of collections as of December 31, 2008 for
each tax type is illustrated below.
Tax Type Number of Payments Amount of Collections
Individual Income Tax 96,529 $61,055,079
Corporate Income Tax 3,536 $18,992,367
Gross Production Taxes 20 $16,027,808
Sales Tax 14,055 $13,579,088
Use Tax 1,055 $3,597,561
WithholdinQ Tax 2,952 $2,115,059
Franchise Tax 690 $195,960
Motor Fuel Taxes 16 $29,127
Bank "in lieu" Tax 0 0
Mixed Beveraqe Taxes 329 $102,217
GRAND TOTAL 119,182 $115,694,266
Clean Slate '08 Participation - Seventy-three (73) of the more than 119,000 payments received
from taxpayers who participated in Clean Slate '08 made payments of more than $100,000. The
great majority of the taxpayers made payments of less than $1,000. The average payment was
$971.
Number of Payments Received by Payment Range
80000
,'~
03,982
,0:: -s- If,.
V ,
,
V
,
V ,
rs
V .,
•
12,681 r 1,522 577 289 58 49 24
120000
100000
60000
40000
20000
o
$0 -
$1,000
$1,001 -
$5,000
$5,001 -
$10,000
$10,001 - $20,001 - $50,001 - $100,001 Over
$20,000 $50,000 $100,000 $500,000
$500,000
10
Collections by State- The initiative resulted in collections from taxpayers in all 50 states plus
Washington, D.C., Puerto Rico, Guam, and the Virgin Islands. Approximately 24% of the
collections came from out-of-state taxpayers. The list below details the amount of collections and
number of payments collected from each state.
STATE AMOUNT NUMBER OF PERCENTAGE OF
COLLECTED PAYMENTS COLLECTIONS
America Emeritus* $3,848.57 13 0.00%
AK $113,590.99 69 0.10%
AL $51,979.77 81 0.04%
AR $460,273.37 781 0.40%
AZ $188,962.87 249 0.16%
CA $779,021.71 992 0.67%
CO $593,691.10 465 0.51%
CT $123,514.28 116 0.11%
District ofColumbia $190,657.11 27 0.16%
DE $48,899.58 19 0.04%
FL $2,305,109.63 465 1.99%
GA $168,512.40 244 0.15%
Guam $425.00 1 0.00%
HI $9,296.25 22 0.01%
IA $67,793.24 73 0.06%
ID $12,082.83 31 0.01%
IL $329,020.97 366 0.28%
IN $72,601.39 111 0.06%
KS $444,198.89 862 0.38%
KY $57,140.03 46 0.05%
LA $155,666.74 153 0.13%
MA $512,976.95 171 0.44%
MD $176,577.80 90 0.15%
ME $2,117.75 10 0.00%
MI $150,771.30 117 0.13%
MN $448,358.73 150 0.39%
MO $1,582,498.74 526 1.37%
MS $114,194.10 93 0.10%
MT $9,689.95 32 0.01%
NC $608,660.60 144 0.53%
ND $2,307.98 8 0.00%
NE $116,299.04 67 0.10%
NH $3,194.89 21 0.00%
NJ $712,571.88 224 0.62%
NM $107,837.12 170 0.09%
11
NV $108,003.89 114 0.09%
NY $3,577,300.93 571 3.09%
OH $190,765.16 207 0.16%
OK $89,108,348.00 106,251 77.02%
OR $54,328.62 96 0.05%
PA $878,851.10 182 0.76%
Puerto Rico $201.00 1 0.00%
RI $21,532.86 20 0.02%
SC $63,869.77 89 0.06%
SD $42,892.24 23 0.04%
TN $1,074,674.27 175 0.93%
TX $9,079,901.83 3,801 7.85%
UT $36,280.60 99 0.03%
VA $271,619.17 184 0.23%
Virgin Islands $1,980.00 1 0.00%
VT $745.44 6 0.00%
WA $213,308.39 169 0.18%
WI $167,079.48 103 0.14%
WV $6,909.72 22 0.01%
WY $71,329.86 59 0.06%
Summary
In-State Totals $89,108,348.00 106,251 77.02%
Out-of-State Totals $26,585,917.88 12,931 22.98%
TOTAL $115,694,265.88 119,182 100.00%
*America Emeritus represents payments from taxpayers in the Armed Forces stationed
outside the United States.
12
Collections by Tax Period - The eligible tax periods for the initiative were for periods ending
prior to January 1, 2008. The amounts received covered many tax periods. The oldest calendar
year represented was 1964. Every year since 1964 was represented in the initiative. The chart
below illustrates the payments made and amounts recei.ve d per tax peno. d.
YEAR AMOUNT COLLECTED
1964 $9,798.00
1965 $5,141.02
1966 $2,482.00
1967 $4,068.47
1968 $3,388.00
1969 $3,922.37
1970 $4,661.73
1971 $50,775.28
1972 $65,042.57
1973 $110,905.11
1974 $281,827.19
1975 $214,312.10
1976 $432,184.08
1977 $384,518.08
1978 $828,005.92
1979 $827,855.61
1980 $1,083,207.70
1981 $1,116,599.82
1982 $1,001,387.40
1983 $1,014,849.25
1984 $810,025.65
1985 $686,105.54
1986 $512,967.17
1987 $900,168.69
1988 $1,211,788.15
1989 $990,095.20
1990 $1,177,942.67
1991 $1,095,558.08
1992 $987,364.01
1993 $727,201.77
1994 $758,666.37
1995 $858,515.07
1996 $715,851.47
1997 $821,349.51
1998 $1,068,345.93
1999 $1,289,957.00
2000 $2,041,022.03
2001 $1,915,348.58
2002 $2,454,628.64
2003 $4,453,359.44
2004 $4,168,094.27
2005 $8,559,309.00
2006 $9,905,170.34
2007 $60,140,499.60
TOTAL $115,694,265.88
13
Settlement of Legal Cases - In addition to the collection of established liabilities, the initiative
provided opportunity to settle administrative protests, civil litigation and other cases handled by
the Commission's Office of General Counsel. The Office of General Counsel closed a total of 62
different cases and collected $14,476,105. An additional amount of $4,834,553 is expected to be
paid through payment plan arrangements prior to June 15,2009.
Summary of Legal Settlements
FILE TYPE NUMBER AMOUNT PAYMENT
PLANS
Protests 12 $1,540,064.03 $148,766.00
Litigation 13 $11,670,468.04 $4,450,000.00
Miscellaneous 7 $790,206.09
Collections 24 $367,285.04 $228,814.51
Abatements 2 $63,315.80 $6,972.05
Foreclosures/Quiet Titles 4 $44,765.92
TOTALS 62 $14,476,104.92 $4,834,552.56
Implementation Costs - The total cost to implement the initiative was approximately $16
million. The total consists of the GRC Contract which cost $15,500,000 to date and the Jordan
and Associates contract which cost a total of $500,000. In all, Oklahoma collected approximately
$7 for every $1 it invested to implement the initiative.
14
APPENDIX A
ENROLLED SENATE
BILL NO. 2034 By: Mazzei and Wilson of the Senate
and
Terrill of the House
An Act relating to revenue and taxation; directing Oklahoma Tax
Commission to establish Voluntary Compliance Initiative; providing
taxpayer with waiver under specified circumstances; limiting time period
during which certain action may be taken; requiring Tax Commission to
abate from certain actions under specified circumstances; defining term;
authorizing application of certain penalty unless certain circumstances
exist; requiring Tax Commission to promulgate rules; authorizing Tax
Commission to take certain actions and to be exempt from specified
requirements for the purpose of implementation; amending Section 3,
Chapter 503, O.S.L. 2002 (68 O.S. Supp. 2007, Section 2358.6), which
relates to certain bonus depreciation adjustments; providing for increase of
federal taxable income of certain entities for purposes of Economic
Stimulus Act of 2008; requiring filing of amended returns; amending 68
O.S. 2001, Section 2358, as last amended by Section 4 of Enrolled House
Bill No. 2693 of the 2nd Session of the 51st Oklahoma Legislature, which
relates to income tax; requiring certain adjustments to taxable income;
defining terms; providing for application of certain rules; providing for
codification; providing an effective date; and declaring an emergency.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified in the Oklahoma
Statutes as Section 216.3 of Title 68, unless there is created a duplication in numbering, reads as
follows:
A. For the purpose of encouraging the voluntary disclosure and payment of taxes owed to
this state, the Oklahoma Tax Commission is hereby authorized and directed to establish a
Voluntary Compliance Initiative for eligible taxes, as provided in this section. A taxpayer shall
be entitled to a waiver of penalty, interest and other collection fees due on eligible taxes if the
taxpayer voluntarily files delinquent tax returns and pays the taxes due during the compliance
initiative. The time in which a voluntary payment of tax liability may be made or the taxpayer
may enter into a payment program acceptable to the Tax Commission for the payment of the
unpaid taxes in full in the manner and time established in a written payment program agreement
between the Tax Commission and the taxpayer under the Voluntary Compliance Initiative is
limited to the period beginning on September 15,2008, and ending on November 14, 2008.
15
B. Upon payment of the eligible taxes under the Voluntary Compliance Initiative
established, the Tax Commission shall abate and not seek to collect any interest, penalties,
collection fees, or costs that would otherwise be applicable and release any liens imposed.
C. As used in this section, "eligible taxes" shall include the following taxes that were due
and payable for any tax period or periods ending before January 1,2008:
1. Mixed Beverage tax levied pursuant to Section 576 of Title 37 of the Oklahoma
Statutes,
2. Gasoline and diesel tax levied pursuant to Section 500.4 of Title 68 ofthe Oklahoma
Statutes;
3. Gross Production and petroleum excise tax levied pursuant to Sections 1001, 1101 and
1102 of Title 68 of the Oklahoma Statutes;
4. Franchise tax levied pursuant to Sections 1203 or 1204 of Title 68 of the Oklahoma
Statutes;
5. Sales tax levied pursuant to Sections 1354 of Title 68 of the Oklahoma Statutes;
6. Use tax levied pursuant to Section 1402 of Title 68 of the Oklahoma Statutes;
7. Income tax levied pursuant to Section 2355 of Title 68 of the Oklahoma Statutes;
8. Withholding tax levied pursuant to 2385.2 of Title 68 of the Oklahoma Statutes; and
9. Privilege tax levied pursuant to Section 2370 of Title 68 of the Oklahoma Statutes.
D. If any eligible tax, or any part thereof, is not paid before the end of the Voluntary
Compliance Initiative established under this section or in conformity with a written payment
agreement entered into during the Voluntary Compliance Initiative between the Tax Commission
and the taxpayer for payment of the unpaid eligible taxes, a penalty equal to the amount of
delinquent penalty imposed by the applicable section for nonpayment of the tax shall be added
thereto, collected and paid; provided, the Tax Commission shall not collect the penalty assessed
in this section if the individual or entity from which the tax liability is due was not eligible to
participate in the compliance initiative or the taxpayer has timely filed a protest of an assessment
pursuant to Section 221 of Title 68 of the Oklahoma Statutes or is otherwise a contested matter
before a court of competent jurisdiction.
E. The Tax Commission shall promulgate rules detailing the terms and other conditions of
this program.
F. The Tax Commission is authorized to expend necessary available funds, including
contracting with third parties, to publicly advertise, assist in the collection of eligible taxes, and
administer the Voluntary Compliance Initiative and shall be exempt from the provisions of
Section 85.7 of Title 74 of the Oklahoma Statutes for the purpose of implementing this section.
16
APPENDIXB
TITLE 710. OKLAHOMA TAX COMMISSION
CHAPTER 1. ADMINISTRATIVE OPERATIONS
RULEMAKING ACTION:
EMERGENCY adoption
RULES:
Subchapter 9. Oklahoma Voluntary Compliance Initiative [NEW]
710:1-9-1 through 710:1-9-10 [NEW]
AUTHORITY:
68 O.S. §§ 203, 216.3; Oklahoma Tax Commission
DATES:
Adoption:
July 8, 2008 (Commission Order No. 2008-7-08-04)
Effective:
Immediately upon Governor's approval
Expiration:
Effective through July 14, 2009, unless superseded by another rule or disapproval by the
Legislature.
SUPERSEDED EMERGENCY ACTIONS:
n/a
INCORPORATIONS BY REFERENCE:
n/a
FINDING OF EMERGENCY:
. Compelling public interest was found to warrant emergency promulgation of these rules to
insure that the public has timely information regarding the Voluntary Compliance Initiative
authorized by the 51st Legislature, 2nd Regular Session, and due to commence September 15, 2008.
ANALYSIS:
These rules set out definitions, delineate in detail the types of taxes, penalties and interest to
which the Voluntary Compliance Institutive program will apply, describes the qualifications for
waiver and the manner in which a taxpayer may take advantage of this program. Finally, the rules
provide contact information and address some special circumstances which may arise.
CONTACT PERSON:
Lisa Haws, OBA #12695, Tax Policy Analyst; (405) 521-3133
PURSUANT TO THE ACTIONS DESCRIBED HEREIN, THE FOLLOWING
EMERGENCY RULES ARE CONSIDERED PROMULGATED AND EFFECTIVE UPON
APPROVAL BY THE GOVERNOR, AS SET FORTH IN 75 O.S. SECTION 253(D):
SUBCHAPTER 9. OKLAHOMA VOLUNTARY COMPLIANCE INITIATIVE
710:1-9-1. General provisions
In order to encourage the voluntary disclosure and payment of taxes owed to the State, the
Legislature has authorized the Oklahoma Tax Commission to establish a two-month period
during which a full waiver of penalty, interest and any other collection fees due on eligible taxes
shall be granted to any taxpayer who voluntarily files delinquent returns or reports and pays the
17
taxes owed for any and all periods ending before January 1, 2008.
710:1-9-2. Definitions
The following words and tenus, when used in this Subchapter, shall have the following
meaning, unless the context clearly indicates otherwise:
"Voluntary Compliance Initiative" means a program providing for the waiver of interest,
penalty, and any other collection fees associated with an eligible Oklahoma tax liability which
was due and payable for any tax period ending before January 1, 2008.
"Voluntary compliance initiative period" means the period commencing at the start of the
posted business day on September 15,2008 and ending on November 14,2008.
"Commission" means the Oklahoma Tax Commission.
710:1-9-3. Eligible tax liabilities to which Voluntary Compliance Initiative may apply
(a) All penalties and interest imposed upon the taxes and fees set out in this subsection are
eligible for waiver pursuant to the Voluntary Compliance Initiative: [See: 68 O.S. § 216.3,
generally]
(1) Mixed Beverage tax levied pursuant to Section 576 of Title 37 ofthe Oklahoma Statutes.
(2) Gasoline and diesel tax levied pursuant to Section 500.4 of Title 68 ofthe Oklahoma
Statutes:
(3) Gross Production and petroleum excise tax levied pursuant to Sections 1001. 1101 and
1102 of Title 680fthe Oklahoma Statutes: -,
(4) Franchise tax levied pursuant to Sections 1203 or 1204 of Title 68 of the Oklahoma
Statutes:
(5) Sales tax levied pursuant to Sections 1354 of Title 68 ofthe Oklahoma Statutes:
(6) Use tax levied pursuant to Section 1402 of Title 68 ofthe Oklahoma Statutes:
(7) Income tax levied pursuant to Section 2355 of Title 68 ofthe Oklahoma Statutes:
(8) Withholding tax levied pursuant to 2385.2 of Title 68 ofthe Oklahoma Statutes: and
(9) Privilege tax, commonly known as the bank in lieu tax, levied pursuant to Section 2370
of Title 68 ofthe Oklahoma Statutes.
(b) Other penalties described in this subsection may also be waived pursuant to the Voluntary
Compliance Intuitive.
(1) Penalty for negligence or failure or refusal to file. [See: 68 O.S. § 217(E)]
(2) Penalty for fraud. [See: 68 O.S. § 217(F)]
(3) Penalty on the face of a tax warrant for failure to pay a delinquent tax. [See: 680.S. §
231.1]
(4) Penalty for filing a report or return with insufficient infonuation. [See: 68 O.S. § 247]
(5) Any other penalty associated with a tax or fee levied or administered by the Commission
pursuant to Titles 68 or 37 of the Oklahoma Statutes.
710:1-9-4. Qualification for Voluntary Compliance Initiative
(a) Applicability. Waiver of penalties and interest pursuant to the Voluntary Compliance
Initiative shall apply only to tax liabilities which were due and payable for any tax period or
periods ending before January 1, 2008.
(b) Reports and returns. The Commission shall waive the penalty, interest and other collection
fees of any taxpayer who meets the statutory requirements and:
(1) Voluntarily files delinquent returns or reports and pays in full the taxes associated with
the filing periods for which waiver is sought or enters into a written payment plan
acceptable to the Tax Commission for the payment of the unpaid taxes in full in the manner
and time established between the Tax Commission and the taxpayer;
18
(2) Voluntarily files amended tax returns or reports to correct an incorrect or insufficient
original return or report, along with remittance of the taxes associated With the filing
periods for which waiver is sought or enters into a written payment plan acceptable to the
Tax Commission for the payment of the unpaid taxes in full in the manner and time
established between the Tax Commission and the taxpayer; or,
(3) Voluntarily pays in full or enters into a written payment plan acceptable to the Tax
Commission for the payment of previously assessed tax liabilities in the manner and time
established between the Tax Commission and the taxpayer.
710:1-9-5. Application procedures
To obtain a waiver of penalty, interest and collection fees pursuant to the Voluntary
Compliance Initiative, the applicant must follow the procedures set out in this subsection.
. (1) Time of payment. A taxpayer must make a full payment of the taxes due or enter into a
written payment plan between September 15, 2008, and not later than November 14, 2008,
for each of the taxes and filing periods for which waiver is sought.
(2) Form of payments. Payments made by taxpayers under the Voluntary Compliance
Initiative may be in the form of cash, a check, a money order, electronic funds transfer, or
may be charged to an approved credit card. [See: http://www.tax.ok.gov/payments.htmll
710:1-9-6. Verification and review
Any tax return or report filed under the Voluntary Compliance Initiative will remain subject
to verification and review.
710:1-9-7. Disclosure
No return or document filed with the Commission pursuant to the Voluntary Compliance
Initiative will be subject to disclosure, except as provided by 68 O. S. § 205.
710:1-9-8. Nonpayment penalty
(a) If any eligible tax is not paid before the end of the Voluntary Compliance Initiative or in
conformity with a written payment plan entered into during the Voluntary Compliance Initiative,
penalty equal to the amount of the original delinquent penalty imposed by the applicable section
for nonpayment of the tax shall be added thereto.
(b) The Tax Commission shall not collect the penalty assessed in this Section if the individual
or entity from which the tax liability is due was not eligible to participate in the compliance
initiative.
(c) The Tax Commission shall not collect the penalty assessed in this Section if the taxpayer
has timely filed a protest of an assessment pursuant to Section 221 of Title 68 of the Oklahoma
Statutes or is otherwise engaged in a contested matter before a court of competent jurisdiction.
(d) The Commission shall not collect the penalty assessed in this Section if the taxpayer has a
pre-existing payment plan with the Commission or one of its vendors and fulfills said payment
plan.
710:1-9-9. Special circumstances
(a) Pending protest. Any taxpayer who has a protest pending with respect to an assessment
made by the Commission is eligible for participation in the Voluntary Compliance Initiative if
the taxpayer pays the taxes assessed in full and withdraws the protest.
(b) Criminal prosecution. The Commission will not grant a waiver to any taxpayer who is the
subject of a State tax related criminal investigation or criminal prosecution.
(c) Court costs, garnishments, warrant costs, warrant penalties. Court costs, garnishments,
warrant penalties and warrant costs are eligible for waiver under the Voluntary Compliance
19
Initiative.
Cd)Application of payments. A taxpayer request that payment under the Voluntary Compliance
Initiative be applied to a particular tax liability or period can be honored to the extent that it is
consistent with OAC 710 1-3-46, dealing with application of payments in general.
Ce)Court approval not required. Because waiver of penalty and interest through the Voluntary
Compliance Initiative is accomplished by operation of law, no Tax Commission Order will be
issued, and no approval by a District Court will be necessary to make such waiver effective. cn Bankruptcy. Generally, a taxpayer who is currently in bankruptcy is not eligible for
participation in the Voluntary Compliance Initiative.
710:1-9-10. Payment plan guidelines
Ca) Individuals and businesses are eligible to enter into a payment plan if they are unable to pay
the taxes in full during the voluntary compliance initiative period. The payment plan must be
established between September 15,2008 and November 14,2008.
Cb) If the payment plan is established between September 15th and September 30th, a minimum
down payment of 20% must be made with the request. The first payment will be due on
November 15,2008 with at least 10% of the original base tax amount due monthly on the 15th of
the month through June 15,2009.
Cc) If the payment plan is established between October 1st and October 31st, a minimum down
payment of30% must be made with the request. The first payment will be due on December 15,
2008 with at least 10% of the original base tax amount due montWy on the 15th of the month
through June 15,2009.
Cd) If the payment plan is established between November 1st and November 14th, a minimum
down payment of 40% must be made with the request. The first payment will be due on January
15,2009 with at least 10% of the original base tax amount due monthly on the 15th of the month
through June 15,2009.
20
APPENDIXC
Clean Slate '08
Frequently Asked Questions
General Overview
What is Clean Slate '08?
Clean Slate '08 is a limited-time opportunity for individuals and businesses to pay past-due taxes
free of penalty, interest and collection fees without fear of possible litigation. It runs from
September 15 through November 14,2008.
What will happen if I don't participate in Clean Slate '08?
If you don't participate in Clean Slate '08 within the September 15 through November 14,2008
time period, an additional Clean Slate '08-related penalty equal to double the original penalty
will be assessed against all of your unpaid tax due for any tax period(s) ending before January 1,
2008. This is in addition to any previously assessed penalties, interest and/or collection fees.
What does the program cover and how will Clean Slate '08 participation affect me?
The program covers any tax period(s) ending before January 1,2008 for which:
you have an outstanding obligation;
· you have not filed a return; or
· you have underreported your tax liability.
If you meet the requirements and pay the full amount of tax due, the aTC will cancel penalty,
interest and collection fees associated with those tax periods.
Are there any exceptions to having to pay an additional penalty in the event I don't
participate in the Clean Slate '08 program?
Yes. The additional penalty won't be imposed if you have a pre-existing payment plan with the
OTC or one of its vendors and you fulfill that plan.
Who is Eligible?
Is Clean Slate '08 available to me?
Clean Slate '08 is available to both individuals and businesses who owe taxes for any tax
period(s) ending before January 1,2008 ifthey:
· did not file the required Oklahoma tax retum(s);
· underreported income and/or tax due on a previously filed tax retum(s);
claimed excessive deductions; and/or
· did not pay previously assessed taxes, interest, penalties, and/or collection fees.
What taxes are eligible for Clean Slate '08?
Mixed Beverage taxes
· Gasoline and Diesel taxes
· Gross Production and Petroleum Excise taxes
· Franchise taxes
21
· Sales taxes
· Use taxes
· Income taxes (including 2007 income tax liabilities)
· Withholding taxes
· Privilege (also known as "bank in lieu") taxes
I'm not registered with the OTC to pay taxes, but I know I owe. Am I eligible for the Clean
Slate '08 program?
Yes, if the taxes are due for any tax period(s) ending before January 1, 200S, you are eligible.
You will need to file all delinquent returns and submit full payment to OTC postmarked prior to
or on November 14, 200S.
Do I have to be an Oklahoma resident to be eligible for Clean Slate '08?
No. All taxpayers, wherever they reside, are eligible.
How to Participate
How do I take advantage of Clean Slate '08?
By mail.
�� OTC: Clean Slate 'OS
Post Office Box 269059
Oklahoma City, OK 73126-9059
By internet.
· www.cleanslateOS.org
By telephone.
· I-S77-320-7612
In person.
· See locations listed below.
What do I need to do?
Call the Clean Slate 'OS hotline to speak to a Clean Slate '08 representative.
· File any missing returns for those tax periods for which you applied for Clean
Slate 'OS.
Submit payment to aTC postmarked prior to or on November 14, 200S.
Set up a Clean Slate '08 payment plan by November
14,2008 and pay the taxes in full according to the plan.
May I file an extension for Clean Slate '08?
No.
22
What happens if I delay filing and paying past-due taxes until the Clean Slate '08 period
begins?
The state will continue its normal compliance, enforcement, and collection efforts to enforce the
Oklahoma tax laws. It also means that normal billing and collection actions will continue. This
could result in garnishments of wages, audits, litigation and other actions allowed by law.
How To Pay
When must I pay?
You must pay your Clean Slate '08 balance by November 14, 2008. If you cannot pay by this
deadline, you may set up a Clean Slate '08 payment plan between September 15 and November
14, 2008, and pay the taxes in full according to the schedule established by the plan.
What payment methods are available?
Several payment options are available to taxpayers. These options include:
• Check,
• Electronic Check (e-check),
• Credit Card,
• Money Order,
• Cashier Check,
• Cash, and
• Wired Payments.
Which of the OTC offices will accept payments?
· The main office in Oklahoma City;
Tulsa Metro office;
· Ardmore area office; and the
· Lawton area office.
May I pay the amount I owe for the Clean Slate '08 period to the collection agency that
currently has my tax liability(s)?
Yes, if you are in a payment plan arrangement or in a wage garnishment with a current OTC
collection agency, you must contact that collection agency directly. If you are not currently in a
payment plan arrangement or in a wage garnishment, you must follow Clean Slate '08
procedures.
Payment Plan Options
Who is eligible, and how does it work?
Call the Clean Slate '08 hotline between September 15 and November 14, 2008 to speak to a
representative who will explain all payment plan options available.
23
How do I apply for a Clean Slate '08 payment plan?
Call the Clean Slate 'OS hotline between September 15 and November 14, 200S to speak to a
representative who will assist you in making application.
Will the time period for payment plans be extended past the deadline within the plan due
to special circumstances?
There are no provisions to extend the payment period past the deadline.
What happens if I have a Clean Slate '08 payment plan and miss a payment or I am late
with a payment?
You will have defaulted on the terms of the payment plan and are no longer eligible for Clean
Slate 'OS.
I currently have a payment plan with the OTC or one of their selected members. Do I have
to participate in the Clean Slate '08 program?
No, you are not required to participate. However, you may choose to participate in order to
eliminate all penalties, interest and collection fees that are still due.
Miscellaneous
I paid all or part of my penalty prior to September 15, 2008. Will you waive the penalty I
paid and refund the penalty payments to me?
The law does not allow for payments made before September 15, 200S or after November 14,
200S to receive the benefit ofthe Clean Slate 'OS program.
Can Clean Slate '08 be revoked?
Yes, for those who do not fulfill their Clean Slate 'OS obligation.
24

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T 500.3 V943c 2009 c.l
Oklahoma
Voluntary Compliance Initiative
"CLEAN SLATE 08"
Final Report
Submitted by the Oklahoma Tax Commission
Tuesday, January 20, 2009
OKLAHOMA VOLUNTARY COMPLIANCE INITIATIVE
CLEAN SLATE '08
FINAL REPORT
TABLE OF CONTENTS
EXECUTIVE SUMMARY 3
Planning 6
Delinquent Accounts 6
Collection Agencies 6
Customer Service 7
LEGISLATIVE HISTORY 4
RESEARCH AND STRATEGIC PLANNING 5
IMPLEMENTATION 6
Public Relations 7
INITIA TIVE OUTCOMES AND RESUL TS 8
Taxpayer Interest 8
Collections During the Initiative 9
Payment Plans 9
Collections by Tax Type 10
Clean Slate '08 Participation 10
Collections by State 11
Collections by Tax Period 13
Settlement of Legal Cases 14
Implementation Costs 14
APPENDIX A
Section 1 of Enrolled House Bill 2034 15
APPENDIXB
Oklahoma Tax Commission Emergency Rules .17
APPENDIXC
Clean Slate '08 Frequently Asked Questions .21
2
EXECUTIVE SUMMARY
The collection of taxes is essential to provide revenue for general and specific functions of state
government. The non-payment of state taxes impedes the funding of these governmental
functions. In an effort to assist the Oklahoma Tax Commission in collecting delinquent tax
liabilities, Governor Brad Henry signed legislation into law on June 3, 2008 authorizing a
voluntary tax compliance initiative. The purpose of the initiative was to collect tax delinquencies
through a waiver of penalties and interest. The initiative began September 15, 2008 and ended
November 14, 2008.
The initiative, known as Clean Slate '08, was well received by the public and was an
overwhelming success.
During the initiative (Sept. 15 through Nov. 14), the Oklahoma Tax Commission collected
approximately $91 million. The Tax Commission received promises to pay, through payment
plans, of an additional $37 million on or before June 15, 2009. Therefore, total collections for the
initiative could reach as high as $128 million. As of December 31, 2008, the Tax Commission
has collected an additional $24 million from these payment plans. Therefore, the total collections
for the initiative, to date, are $115 million. The initiative was originally estimated to add an,
additional $34 million to the state coffers.
The success of the program can be traced to the dedication and contributions of the employees of
the Tax Commission. Tax Commission personnel were actively involved in developing and
implementing all aspects of the program. These duties included planning operations, researching
tax accounts, educating taxpayers, processing payments, providing technological tools, and
focusing on customer service. This unified effort resulted in collections that more than tripled the
original estimate. The commitment was not only made by those employees working directly on
the initiative, but also came from employees agency-wide working to ensure the other functions
of the agency were met during this time.
While the program has officially ended, there is still work to be done. The Tax Commission
continues working with taxpayers who entered into payment plan arrangements during the
initiative. The Tax Commission will also be working to collect taxes from the citizens that were
eligible for, but did not participate in, the initiative or who may default on the payment plans.
The Tax Commission has now entered into a partnership to identify and locate citizens who have
not fulfilled their responsibilities to pay their taxes due and owing to the State.
The following report provides an overview of the initiative and its results.
3
LEGISLATIVE HISTORY
Enrolled Senate Bill 2034, authored by Sens. Mike Mazzei and Jim Wilson of the Senate and
Rep. Randy Terrill of the House, was signed by Gov. Brad Henry on June 3, 2008. For the
"purpose of encouraging the voluntary disclosure and payment of taxes owed to the state",
Section 1 of the legislation authorized and directed the Oklahoma Tax Commission to establish a
voluntary compliance initiative for eligible taxes (see Appendix A).
The legislation further provided that the Tax Commission was to establish the voluntary
compliance initiative for all "eligible taxes" during the period of September 15, 2008 through
November 14,2008. The "eligible taxes" included:
1. Gasoline and diesel taxes,
2. Franchise tax,
3. Gross Production and petroleum excise taxes,
4. Corporate Income tax,
5. Bank "in lieu" taxes,
6. Individual Income tax,
7. Withholding taxes,
8. Sales and Use taxes, and
9. Mixed Beverage taxes.
Taxpayers who remitted eligible taxes through the initiative would receive a full waiver of
penalty, interest and any other collection fees. The legislation provided that the taxpayer will be
deemed to have "paid" the tax if the tax is paid in full or complies in full with a payment plan
agreement established through the initiative. To be eligible for the waiver, the taxes had to be due
and payable for a taxable period ending on or before December 31, 2007.
The legislation further provided that if an eligible taxpayer fails to take advantage of the
initiative, an additional penalty equal to the original penalty will be assessed. The double penalty
provision does not apply if the taxpayer was not eligible to participate in the initiative or the
taxpayer timely filed a protest of an assessment or otherwise contested the matter before a court
of competent jurisdiction.
The Tax Commission was given authority to expend funds to contract with third parties to
publicly advertise, assist in the collection of eligible taxes, and administer the initiative. The Tax
Commission was also given authority to promulgate rules to carry out the initiative. The rules
were adopted in emergency form on July 8, 2008 (see Appendix B).
4
RESEARCH AND STRATEGIC PLANNING
Prior to implementation, the Administrator appointed an internal leadership team, co-project
managers, and five process teams (Communications, Taxpayer Outreach, Operations, Procedures,
and Technology). The teams and their assigned responsibilities were as follows:
Leadership Team - consisted of the Agency Administrator, Deputy Administrators,
Comptroller, Counselor to the Commissioners, and Co-Project Managers. The team's
responsibilities included the business plan, infrastructure needs, budget oversight, contract
administration, schedule tracking, and ongoing reports.
Communications Team - led by the Communications Division Director and consisted of
members of the following divisions: Taxpayer Assistance, Account Maintenance, Tax Policy and
Information Technology. The team's responsibilities included public relations, media buys and
placement, forms development, press releases, web design, speaking presentations, and outreach
letters.
Procedures Team - led by the Tax Policy Division Director and consisted of members of the
following divisions: Tax Policy, General Counsel's Office, Communications, and Information
Technology. The team's responsibilities included rule promulgation, written procedures, FAQ
Development, and Legislative LiaisonlInformation.
Technology Team - led by the Information Technology Division Director and consisted of
members of the following divisions: Information Technology, Account' Maintenance,
Compliance, and Tax Policy. The team's responsibilities included systems development, data
gathering (taxpayer and account identification), and data analysis.
Operations Team - led by the Account Maintenance Division Director and consisted of
members of the following divisions: Account Maintenance, Central Processing, Taxpayer
Assistance, Compliance, Information Technology, General Counsel's Office, and Management
Services. The team's responsibilities included return and payment processing, revenue allocation,
payment plan administration, warrant releases, printing and mailing, returned mail, and backlog
reduction.
Taxpayer Outreach Team - led by the Taxpayer Assistance Division Director and consisted of
members of the following divisions: Taxpayer Assistance, Compliance, Account Maintenance,
and Human Resources. The team's responsibilities included customer service training,
telephones, walk-ins, system training, and district office assistance.
5
IMPLEMENTATION
Planning - The implementation of the Voluntary Compliance Initiative began with a focus on
identifying delinquent taxpayers, communicating directly with those. delinquent taxpayers,
publicizing the initiative, training employees on all aspects of the initiative, and providing the
best customer service to taxpayers taking advantage of the initiative. It was from this focus that
the assignments were made to the process teams.
Delinquent Accounts - The first step was to identify all the delinquent taxpayers and quantify
the dollar amount of unpaid tax debts. These debts included all outstanding tax liabilities for the
eligible taxes due for periods ending on or before December 31, 2007. This effort identified
253,000 delinquent taxpayers who owed a total of $481 million to the State of Oklahoma.
Collection Agencies - It was decided that contracting with an outside collection agency was
essential to provide the outreach necessary to attain the desired results. The Tax Commission had
existing contracts with two outside collection agencies. Those agencies continued to work on
their active accounts during the initiative. The Tax Commission entered into a contract with a
third collection agency, General Revenue Corporation (GRC), to assist in reaching all other
taxpayers and provide debt collection services specifically for the initiative.
The GRC contract agreement included:
• Segmentation and Prioritization of Accounts - Using its own resources, GRC created a
data warehouse team for the purpose of creating and supporting a data warehouse process
unique to the requirements and needs of the Oklahoma Tax Commission. GRC divided
the accounts into four sub-groups (in-state individual, out-of-state individual, in-state
business, and out-of-state business).
• Targeted Mailings - GRC sent a series of scheduled mailings especially tailored to each
sub-group. An initial informational letter was followed by a second letter advising of
consequences for non-compliance with the initiative, and subsequent letters as needed.
For all sub-groups, the initial informational letter was followed by a targeted outbound
phone campaign. These targeted mailings resulted in 330,618 letters mailed out to
delinquent taxpayers.
• Inbound and Outbound Phone Campaign - GRC fielded inbound calls and made
targeted, auto-dialed outbound calls related to the initiative. The phone campaign hours of
operation extended beyond the Tax Commission's normal business hours, operating
from:
o 8:00 am - 9:00 pm Monday through Friday
o 8:00 am - 8:00 pm Saturday
This extended availability resulted in answering 129,157 inbound calls and placing
615,315 outbound calls. Tax Commission employees answered an additional 79,531 calls
placed to its offices in addition to the calls answered by GRC.
• Skip-Tracing Efforts - GRC utilized a skip-tracing process to handle all returned mail
and locate delinquent taxpayers. Upon receipt of returned mail, GRC completed a skip-trace
program to locate a viable address. GRC will return the accounts with any updated
contact information to the Tax Commission for use in future compliance efforts.
6
Customer Service - For taxpayer convenience, a special toll-free number was established for
incoming calls. In addition, a special page on the Tax Commission's website was dedicated to
provide initiative information. An initiative e-mail address was established for taxpayer e-mail
questions and correspondence.
Customer-service training was also provided to employees dealing with taxpayers. Additionally,
the Tax Commission offered extended customer service hours at its main office during the last
week of the initiative.
An extensive FAQ (Frequently Asked Questions) was posted on the web site to provide quick
and easy answers to questions for the general public. A copy of the FAQs is attached as Exhibit
C.
Public Relations - Communicating with the public was essential for the initiative to be
successful. With funding provided by the Legislature, the Tax Commission entered into a
contract with Jordan and Associates, an advertising and marketing firm, to design, develop and
implement a multi-media campaign that used a combination of approaches, strategically
implemented, over a 10-week period to promote participation in the initiative on a state-wide
basis.
The contract required the firm to develop and produce at least one 30-second television
commercial, one 60-second radio commercial, one printed piece for mailing, one billing stuffer
piece/postcard, a newspaper ad for several state publications, State Fair publication, all media
purchases, media packets and planning, and to provide kick -off event press conference
assistance. The firm also provided a slogan to tie the campaign together. The slogan decided
upon was Clean Slate '08.
The advertising campaign resulted in the following:
• The television commercial ran 639 times in September, 555 times in October, and 165
times in November for a total of 1,359 times in the Oklahoma City, Tulsa, Sherman, TX,
and Ada markets.
• The radio commercial ran a total of 1,492 times in November in Oklahoma City, Tulsa,
Lawton, and other outlying markets.
• Articles and interviews ran in more than 150 Oklahoma newspapers (including daily and
weekly publications).
• Online advertising (webvertising) began September 15. The largest of these web ads were
in the form of web banner ad placements on NewsOK.com and TulsaWorld.com. The
banners appeared 423,561 times on the NewsOK site and 217,000 on the TulsaWorld
site.
• The Tax Commission also received additional advertising from promotional spots placed
on the television, radio, and the internet at no cost to the agency.
• Numerous speaking engagements presented information on Clean Slate '08 including
engagements at the Western Oklahoma Society of Accountants, Tulsa Small Business
Forum, County Assessors Conference, Enrolled Agents Seminar, El Reno Main Street
Program, Tulsa Society of Certified Public Accountants, Oklahoma Black Chamber of
Commerce, and Tax Commission New Business Workshops.
7
Clean Slate '08 Taxpayer Contacts
INITIATIVE OUTCOMES AND RESULTS
Taxpayer Interest - The Tax Commission experienced a great interest in the initiative from the
public. From September 15 through November 14, 2008, in addition to the incoming calls
detailed earlier in this report, more than 7,100 taxpayers visited the Tax Commission's main
office and district office locations, and more than 2,100 taxpayers contacted the Tax Commission
via email about the initiative.
Oklahoma's initiative followed the pattern of most other tax amnesty programs, in that many
taxpayers waited until the final two days of the amnesty period to take advantage of the program.
Almost half of the walk-ins visited the Commission's offices during the final two days of the
initiative.
The chart below details the contacts made by taxpayers and the Tax Commission's outreach
efforts during the initiative.
..' " ,:';\ ;..
~ 7,199
,
330,61f
• 2,114 ,~
615,315
208,688
I
I I
10'0,000 200,000 300,000 400,000
Number of Contacts
500,000 600,oqO· 700,0(JO
8
Collections During the Initiative - Payments actually made during the initiative totaled
$90,931,944. The chart below illustrates the dates that the payments were made. As illustrated
below, approximately 46% of the collections are attributable to payments made during the final
week of the initiative.
Collections During Clean Slate '08
$45,000,000 $41,974,825
$5,000,000
$40,000,000
$35,000,000
$30,000,000
'C•• .t!!i! $25,000,000
'0 o~
$20,000,000
.!!!
'0
Cl
$15,000,000
$10,000,000
$91,682 $330,508
9/19/2008 9/26/2008 10/3/2008 10/10/2008 10/17/2008 10/24/2008 10/31/2008 111712008 11/14/2008
Week Ending
Payment Plans - A total of approximately 11,500 payment plans were entered into during the
initiative wherein taxpayers promised to pay approximately $37,038,101 by June 15,2009. Those
taxpayers who successfully complete their payment plans will receive the full benefit of the
initiative and receive a waiver of all penalties and interest and other collection fees.
9
Collections by Tax Type - A total of ten (10) different tax types were included in the initiative.
Individual income taxes yielded the most money and number of payments during the initiative. A
breakdown of the number of payments and amount of collections as of December 31, 2008 for
each tax type is illustrated below.
Tax Type Number of Payments Amount of Collections
Individual Income Tax 96,529 $61,055,079
Corporate Income Tax 3,536 $18,992,367
Gross Production Taxes 20 $16,027,808
Sales Tax 14,055 $13,579,088
Use Tax 1,055 $3,597,561
WithholdinQ Tax 2,952 $2,115,059
Franchise Tax 690 $195,960
Motor Fuel Taxes 16 $29,127
Bank "in lieu" Tax 0 0
Mixed Beveraqe Taxes 329 $102,217
GRAND TOTAL 119,182 $115,694,266
Clean Slate '08 Participation - Seventy-three (73) of the more than 119,000 payments received
from taxpayers who participated in Clean Slate '08 made payments of more than $100,000. The
great majority of the taxpayers made payments of less than $1,000. The average payment was
$971.
Number of Payments Received by Payment Range
80000
,'~
03,982
,0:: -s- If,.
V ,
,
V
,
V ,
rs
V .,
•
12,681 r 1,522 577 289 58 49 24
120000
100000
60000
40000
20000
o
$0 -
$1,000
$1,001 -
$5,000
$5,001 -
$10,000
$10,001 - $20,001 - $50,001 - $100,001 Over
$20,000 $50,000 $100,000 $500,000
$500,000
10
Collections by State- The initiative resulted in collections from taxpayers in all 50 states plus
Washington, D.C., Puerto Rico, Guam, and the Virgin Islands. Approximately 24% of the
collections came from out-of-state taxpayers. The list below details the amount of collections and
number of payments collected from each state.
STATE AMOUNT NUMBER OF PERCENTAGE OF
COLLECTED PAYMENTS COLLECTIONS
America Emeritus* $3,848.57 13 0.00%
AK $113,590.99 69 0.10%
AL $51,979.77 81 0.04%
AR $460,273.37 781 0.40%
AZ $188,962.87 249 0.16%
CA $779,021.71 992 0.67%
CO $593,691.10 465 0.51%
CT $123,514.28 116 0.11%
District ofColumbia $190,657.11 27 0.16%
DE $48,899.58 19 0.04%
FL $2,305,109.63 465 1.99%
GA $168,512.40 244 0.15%
Guam $425.00 1 0.00%
HI $9,296.25 22 0.01%
IA $67,793.24 73 0.06%
ID $12,082.83 31 0.01%
IL $329,020.97 366 0.28%
IN $72,601.39 111 0.06%
KS $444,198.89 862 0.38%
KY $57,140.03 46 0.05%
LA $155,666.74 153 0.13%
MA $512,976.95 171 0.44%
MD $176,577.80 90 0.15%
ME $2,117.75 10 0.00%
MI $150,771.30 117 0.13%
MN $448,358.73 150 0.39%
MO $1,582,498.74 526 1.37%
MS $114,194.10 93 0.10%
MT $9,689.95 32 0.01%
NC $608,660.60 144 0.53%
ND $2,307.98 8 0.00%
NE $116,299.04 67 0.10%
NH $3,194.89 21 0.00%
NJ $712,571.88 224 0.62%
NM $107,837.12 170 0.09%
11
NV $108,003.89 114 0.09%
NY $3,577,300.93 571 3.09%
OH $190,765.16 207 0.16%
OK $89,108,348.00 106,251 77.02%
OR $54,328.62 96 0.05%
PA $878,851.10 182 0.76%
Puerto Rico $201.00 1 0.00%
RI $21,532.86 20 0.02%
SC $63,869.77 89 0.06%
SD $42,892.24 23 0.04%
TN $1,074,674.27 175 0.93%
TX $9,079,901.83 3,801 7.85%
UT $36,280.60 99 0.03%
VA $271,619.17 184 0.23%
Virgin Islands $1,980.00 1 0.00%
VT $745.44 6 0.00%
WA $213,308.39 169 0.18%
WI $167,079.48 103 0.14%
WV $6,909.72 22 0.01%
WY $71,329.86 59 0.06%
Summary
In-State Totals $89,108,348.00 106,251 77.02%
Out-of-State Totals $26,585,917.88 12,931 22.98%
TOTAL $115,694,265.88 119,182 100.00%
*America Emeritus represents payments from taxpayers in the Armed Forces stationed
outside the United States.
12
Collections by Tax Period - The eligible tax periods for the initiative were for periods ending
prior to January 1, 2008. The amounts received covered many tax periods. The oldest calendar
year represented was 1964. Every year since 1964 was represented in the initiative. The chart
below illustrates the payments made and amounts recei.ve d per tax peno. d.
YEAR AMOUNT COLLECTED
1964 $9,798.00
1965 $5,141.02
1966 $2,482.00
1967 $4,068.47
1968 $3,388.00
1969 $3,922.37
1970 $4,661.73
1971 $50,775.28
1972 $65,042.57
1973 $110,905.11
1974 $281,827.19
1975 $214,312.10
1976 $432,184.08
1977 $384,518.08
1978 $828,005.92
1979 $827,855.61
1980 $1,083,207.70
1981 $1,116,599.82
1982 $1,001,387.40
1983 $1,014,849.25
1984 $810,025.65
1985 $686,105.54
1986 $512,967.17
1987 $900,168.69
1988 $1,211,788.15
1989 $990,095.20
1990 $1,177,942.67
1991 $1,095,558.08
1992 $987,364.01
1993 $727,201.77
1994 $758,666.37
1995 $858,515.07
1996 $715,851.47
1997 $821,349.51
1998 $1,068,345.93
1999 $1,289,957.00
2000 $2,041,022.03
2001 $1,915,348.58
2002 $2,454,628.64
2003 $4,453,359.44
2004 $4,168,094.27
2005 $8,559,309.00
2006 $9,905,170.34
2007 $60,140,499.60
TOTAL $115,694,265.88
13
Settlement of Legal Cases - In addition to the collection of established liabilities, the initiative
provided opportunity to settle administrative protests, civil litigation and other cases handled by
the Commission's Office of General Counsel. The Office of General Counsel closed a total of 62
different cases and collected $14,476,105. An additional amount of $4,834,553 is expected to be
paid through payment plan arrangements prior to June 15,2009.
Summary of Legal Settlements
FILE TYPE NUMBER AMOUNT PAYMENT
PLANS
Protests 12 $1,540,064.03 $148,766.00
Litigation 13 $11,670,468.04 $4,450,000.00
Miscellaneous 7 $790,206.09
Collections 24 $367,285.04 $228,814.51
Abatements 2 $63,315.80 $6,972.05
Foreclosures/Quiet Titles 4 $44,765.92
TOTALS 62 $14,476,104.92 $4,834,552.56
Implementation Costs - The total cost to implement the initiative was approximately $16
million. The total consists of the GRC Contract which cost $15,500,000 to date and the Jordan
and Associates contract which cost a total of $500,000. In all, Oklahoma collected approximately
$7 for every $1 it invested to implement the initiative.
14
APPENDIX A
ENROLLED SENATE
BILL NO. 2034 By: Mazzei and Wilson of the Senate
and
Terrill of the House
An Act relating to revenue and taxation; directing Oklahoma Tax
Commission to establish Voluntary Compliance Initiative; providing
taxpayer with waiver under specified circumstances; limiting time period
during which certain action may be taken; requiring Tax Commission to
abate from certain actions under specified circumstances; defining term;
authorizing application of certain penalty unless certain circumstances
exist; requiring Tax Commission to promulgate rules; authorizing Tax
Commission to take certain actions and to be exempt from specified
requirements for the purpose of implementation; amending Section 3,
Chapter 503, O.S.L. 2002 (68 O.S. Supp. 2007, Section 2358.6), which
relates to certain bonus depreciation adjustments; providing for increase of
federal taxable income of certain entities for purposes of Economic
Stimulus Act of 2008; requiring filing of amended returns; amending 68
O.S. 2001, Section 2358, as last amended by Section 4 of Enrolled House
Bill No. 2693 of the 2nd Session of the 51st Oklahoma Legislature, which
relates to income tax; requiring certain adjustments to taxable income;
defining terms; providing for application of certain rules; providing for
codification; providing an effective date; and declaring an emergency.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified in the Oklahoma
Statutes as Section 216.3 of Title 68, unless there is created a duplication in numbering, reads as
follows:
A. For the purpose of encouraging the voluntary disclosure and payment of taxes owed to
this state, the Oklahoma Tax Commission is hereby authorized and directed to establish a
Voluntary Compliance Initiative for eligible taxes, as provided in this section. A taxpayer shall
be entitled to a waiver of penalty, interest and other collection fees due on eligible taxes if the
taxpayer voluntarily files delinquent tax returns and pays the taxes due during the compliance
initiative. The time in which a voluntary payment of tax liability may be made or the taxpayer
may enter into a payment program acceptable to the Tax Commission for the payment of the
unpaid taxes in full in the manner and time established in a written payment program agreement
between the Tax Commission and the taxpayer under the Voluntary Compliance Initiative is
limited to the period beginning on September 15,2008, and ending on November 14, 2008.
15
B. Upon payment of the eligible taxes under the Voluntary Compliance Initiative
established, the Tax Commission shall abate and not seek to collect any interest, penalties,
collection fees, or costs that would otherwise be applicable and release any liens imposed.
C. As used in this section, "eligible taxes" shall include the following taxes that were due
and payable for any tax period or periods ending before January 1,2008:
1. Mixed Beverage tax levied pursuant to Section 576 of Title 37 of the Oklahoma
Statutes,
2. Gasoline and diesel tax levied pursuant to Section 500.4 of Title 68 ofthe Oklahoma
Statutes;
3. Gross Production and petroleum excise tax levied pursuant to Sections 1001, 1101 and
1102 of Title 68 of the Oklahoma Statutes;
4. Franchise tax levied pursuant to Sections 1203 or 1204 of Title 68 of the Oklahoma
Statutes;
5. Sales tax levied pursuant to Sections 1354 of Title 68 of the Oklahoma Statutes;
6. Use tax levied pursuant to Section 1402 of Title 68 of the Oklahoma Statutes;
7. Income tax levied pursuant to Section 2355 of Title 68 of the Oklahoma Statutes;
8. Withholding tax levied pursuant to 2385.2 of Title 68 of the Oklahoma Statutes; and
9. Privilege tax levied pursuant to Section 2370 of Title 68 of the Oklahoma Statutes.
D. If any eligible tax, or any part thereof, is not paid before the end of the Voluntary
Compliance Initiative established under this section or in conformity with a written payment
agreement entered into during the Voluntary Compliance Initiative between the Tax Commission
and the taxpayer for payment of the unpaid eligible taxes, a penalty equal to the amount of
delinquent penalty imposed by the applicable section for nonpayment of the tax shall be added
thereto, collected and paid; provided, the Tax Commission shall not collect the penalty assessed
in this section if the individual or entity from which the tax liability is due was not eligible to
participate in the compliance initiative or the taxpayer has timely filed a protest of an assessment
pursuant to Section 221 of Title 68 of the Oklahoma Statutes or is otherwise a contested matter
before a court of competent jurisdiction.
E. The Tax Commission shall promulgate rules detailing the terms and other conditions of
this program.
F. The Tax Commission is authorized to expend necessary available funds, including
contracting with third parties, to publicly advertise, assist in the collection of eligible taxes, and
administer the Voluntary Compliance Initiative and shall be exempt from the provisions of
Section 85.7 of Title 74 of the Oklahoma Statutes for the purpose of implementing this section.
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APPENDIXB
TITLE 710. OKLAHOMA TAX COMMISSION
CHAPTER 1. ADMINISTRATIVE OPERATIONS
RULEMAKING ACTION:
EMERGENCY adoption
RULES:
Subchapter 9. Oklahoma Voluntary Compliance Initiative [NEW]
710:1-9-1 through 710:1-9-10 [NEW]
AUTHORITY:
68 O.S. §§ 203, 216.3; Oklahoma Tax Commission
DATES:
Adoption:
July 8, 2008 (Commission Order No. 2008-7-08-04)
Effective:
Immediately upon Governor's approval
Expiration:
Effective through July 14, 2009, unless superseded by another rule or disapproval by the
Legislature.
SUPERSEDED EMERGENCY ACTIONS:
n/a
INCORPORATIONS BY REFERENCE:
n/a
FINDING OF EMERGENCY:
. Compelling public interest was found to warrant emergency promulgation of these rules to
insure that the public has timely information regarding the Voluntary Compliance Initiative
authorized by the 51st Legislature, 2nd Regular Session, and due to commence September 15, 2008.
ANALYSIS:
These rules set out definitions, delineate in detail the types of taxes, penalties and interest to
which the Voluntary Compliance Institutive program will apply, describes the qualifications for
waiver and the manner in which a taxpayer may take advantage of this program. Finally, the rules
provide contact information and address some special circumstances which may arise.
CONTACT PERSON:
Lisa Haws, OBA #12695, Tax Policy Analyst; (405) 521-3133
PURSUANT TO THE ACTIONS DESCRIBED HEREIN, THE FOLLOWING
EMERGENCY RULES ARE CONSIDERED PROMULGATED AND EFFECTIVE UPON
APPROVAL BY THE GOVERNOR, AS SET FORTH IN 75 O.S. SECTION 253(D):
SUBCHAPTER 9. OKLAHOMA VOLUNTARY COMPLIANCE INITIATIVE
710:1-9-1. General provisions
In order to encourage the voluntary disclosure and payment of taxes owed to the State, the
Legislature has authorized the Oklahoma Tax Commission to establish a two-month period
during which a full waiver of penalty, interest and any other collection fees due on eligible taxes
shall be granted to any taxpayer who voluntarily files delinquent returns or reports and pays the
17
taxes owed for any and all periods ending before January 1, 2008.
710:1-9-2. Definitions
The following words and tenus, when used in this Subchapter, shall have the following
meaning, unless the context clearly indicates otherwise:
"Voluntary Compliance Initiative" means a program providing for the waiver of interest,
penalty, and any other collection fees associated with an eligible Oklahoma tax liability which
was due and payable for any tax period ending before January 1, 2008.
"Voluntary compliance initiative period" means the period commencing at the start of the
posted business day on September 15,2008 and ending on November 14,2008.
"Commission" means the Oklahoma Tax Commission.
710:1-9-3. Eligible tax liabilities to which Voluntary Compliance Initiative may apply
(a) All penalties and interest imposed upon the taxes and fees set out in this subsection are
eligible for waiver pursuant to the Voluntary Compliance Initiative: [See: 68 O.S. § 216.3,
generally]
(1) Mixed Beverage tax levied pursuant to Section 576 of Title 37 ofthe Oklahoma Statutes.
(2) Gasoline and diesel tax levied pursuant to Section 500.4 of Title 68 ofthe Oklahoma
Statutes:
(3) Gross Production and petroleum excise tax levied pursuant to Sections 1001. 1101 and
1102 of Title 680fthe Oklahoma Statutes: -,
(4) Franchise tax levied pursuant to Sections 1203 or 1204 of Title 68 of the Oklahoma
Statutes:
(5) Sales tax levied pursuant to Sections 1354 of Title 68 ofthe Oklahoma Statutes:
(6) Use tax levied pursuant to Section 1402 of Title 68 ofthe Oklahoma Statutes:
(7) Income tax levied pursuant to Section 2355 of Title 68 ofthe Oklahoma Statutes:
(8) Withholding tax levied pursuant to 2385.2 of Title 68 ofthe Oklahoma Statutes: and
(9) Privilege tax, commonly known as the bank in lieu tax, levied pursuant to Section 2370
of Title 68 ofthe Oklahoma Statutes.
(b) Other penalties described in this subsection may also be waived pursuant to the Voluntary
Compliance Intuitive.
(1) Penalty for negligence or failure or refusal to file. [See: 68 O.S. § 217(E)]
(2) Penalty for fraud. [See: 68 O.S. § 217(F)]
(3) Penalty on the face of a tax warrant for failure to pay a delinquent tax. [See: 680.S. §
231.1]
(4) Penalty for filing a report or return with insufficient infonuation. [See: 68 O.S. § 247]
(5) Any other penalty associated with a tax or fee levied or administered by the Commission
pursuant to Titles 68 or 37 of the Oklahoma Statutes.
710:1-9-4. Qualification for Voluntary Compliance Initiative
(a) Applicability. Waiver of penalties and interest pursuant to the Voluntary Compliance
Initiative shall apply only to tax liabilities which were due and payable for any tax period or
periods ending before January 1, 2008.
(b) Reports and returns. The Commission shall waive the penalty, interest and other collection
fees of any taxpayer who meets the statutory requirements and:
(1) Voluntarily files delinquent returns or reports and pays in full the taxes associated with
the filing periods for which waiver is sought or enters into a written payment plan
acceptable to the Tax Commission for the payment of the unpaid taxes in full in the manner
and time established between the Tax Commission and the taxpayer;
18
(2) Voluntarily files amended tax returns or reports to correct an incorrect or insufficient
original return or report, along with remittance of the taxes associated With the filing
periods for which waiver is sought or enters into a written payment plan acceptable to the
Tax Commission for the payment of the unpaid taxes in full in the manner and time
established between the Tax Commission and the taxpayer; or,
(3) Voluntarily pays in full or enters into a written payment plan acceptable to the Tax
Commission for the payment of previously assessed tax liabilities in the manner and time
established between the Tax Commission and the taxpayer.
710:1-9-5. Application procedures
To obtain a waiver of penalty, interest and collection fees pursuant to the Voluntary
Compliance Initiative, the applicant must follow the procedures set out in this subsection.
. (1) Time of payment. A taxpayer must make a full payment of the taxes due or enter into a
written payment plan between September 15, 2008, and not later than November 14, 2008,
for each of the taxes and filing periods for which waiver is sought.
(2) Form of payments. Payments made by taxpayers under the Voluntary Compliance
Initiative may be in the form of cash, a check, a money order, electronic funds transfer, or
may be charged to an approved credit card. [See: http://www.tax.ok.gov/payments.htmll
710:1-9-6. Verification and review
Any tax return or report filed under the Voluntary Compliance Initiative will remain subject
to verification and review.
710:1-9-7. Disclosure
No return or document filed with the Commission pursuant to the Voluntary Compliance
Initiative will be subject to disclosure, except as provided by 68 O. S. § 205.
710:1-9-8. Nonpayment penalty
(a) If any eligible tax is not paid before the end of the Voluntary Compliance Initiative or in
conformity with a written payment plan entered into during the Voluntary Compliance Initiative,
penalty equal to the amount of the original delinquent penalty imposed by the applicable section
for nonpayment of the tax shall be added thereto.
(b) The Tax Commission shall not collect the penalty assessed in this Section if the individual
or entity from which the tax liability is due was not eligible to participate in the compliance
initiative.
(c) The Tax Commission shall not collect the penalty assessed in this Section if the taxpayer
has timely filed a protest of an assessment pursuant to Section 221 of Title 68 of the Oklahoma
Statutes or is otherwise engaged in a contested matter before a court of competent jurisdiction.
(d) The Commission shall not collect the penalty assessed in this Section if the taxpayer has a
pre-existing payment plan with the Commission or one of its vendors and fulfills said payment
plan.
710:1-9-9. Special circumstances
(a) Pending protest. Any taxpayer who has a protest pending with respect to an assessment
made by the Commission is eligible for participation in the Voluntary Compliance Initiative if
the taxpayer pays the taxes assessed in full and withdraws the protest.
(b) Criminal prosecution. The Commission will not grant a waiver to any taxpayer who is the
subject of a State tax related criminal investigation or criminal prosecution.
(c) Court costs, garnishments, warrant costs, warrant penalties. Court costs, garnishments,
warrant penalties and warrant costs are eligible for waiver under the Voluntary Compliance
19
Initiative.
Cd)Application of payments. A taxpayer request that payment under the Voluntary Compliance
Initiative be applied to a particular tax liability or period can be honored to the extent that it is
consistent with OAC 710 1-3-46, dealing with application of payments in general.
Ce)Court approval not required. Because waiver of penalty and interest through the Voluntary
Compliance Initiative is accomplished by operation of law, no Tax Commission Order will be
issued, and no approval by a District Court will be necessary to make such waiver effective. cn Bankruptcy. Generally, a taxpayer who is currently in bankruptcy is not eligible for
participation in the Voluntary Compliance Initiative.
710:1-9-10. Payment plan guidelines
Ca) Individuals and businesses are eligible to enter into a payment plan if they are unable to pay
the taxes in full during the voluntary compliance initiative period. The payment plan must be
established between September 15,2008 and November 14,2008.
Cb) If the payment plan is established between September 15th and September 30th, a minimum
down payment of 20% must be made with the request. The first payment will be due on
November 15,2008 with at least 10% of the original base tax amount due monthly on the 15th of
the month through June 15,2009.
Cc) If the payment plan is established between October 1st and October 31st, a minimum down
payment of30% must be made with the request. The first payment will be due on December 15,
2008 with at least 10% of the original base tax amount due montWy on the 15th of the month
through June 15,2009.
Cd) If the payment plan is established between November 1st and November 14th, a minimum
down payment of 40% must be made with the request. The first payment will be due on January
15,2009 with at least 10% of the original base tax amount due monthly on the 15th of the month
through June 15,2009.
20
APPENDIXC
Clean Slate '08
Frequently Asked Questions
General Overview
What is Clean Slate '08?
Clean Slate '08 is a limited-time opportunity for individuals and businesses to pay past-due taxes
free of penalty, interest and collection fees without fear of possible litigation. It runs from
September 15 through November 14,2008.
What will happen if I don't participate in Clean Slate '08?
If you don't participate in Clean Slate '08 within the September 15 through November 14,2008
time period, an additional Clean Slate '08-related penalty equal to double the original penalty
will be assessed against all of your unpaid tax due for any tax period(s) ending before January 1,
2008. This is in addition to any previously assessed penalties, interest and/or collection fees.
What does the program cover and how will Clean Slate '08 participation affect me?
The program covers any tax period(s) ending before January 1,2008 for which:
you have an outstanding obligation;
· you have not filed a return; or
· you have underreported your tax liability.
If you meet the requirements and pay the full amount of tax due, the aTC will cancel penalty,
interest and collection fees associated with those tax periods.
Are there any exceptions to having to pay an additional penalty in the event I don't
participate in the Clean Slate '08 program?
Yes. The additional penalty won't be imposed if you have a pre-existing payment plan with the
OTC or one of its vendors and you fulfill that plan.
Who is Eligible?
Is Clean Slate '08 available to me?
Clean Slate '08 is available to both individuals and businesses who owe taxes for any tax
period(s) ending before January 1,2008 ifthey:
· did not file the required Oklahoma tax retum(s);
· underreported income and/or tax due on a previously filed tax retum(s);
claimed excessive deductions; and/or
· did not pay previously assessed taxes, interest, penalties, and/or collection fees.
What taxes are eligible for Clean Slate '08?
Mixed Beverage taxes
· Gasoline and Diesel taxes
· Gross Production and Petroleum Excise taxes
· Franchise taxes
21
· Sales taxes
· Use taxes
· Income taxes (including 2007 income tax liabilities)
· Withholding taxes
· Privilege (also known as "bank in lieu") taxes
I'm not registered with the OTC to pay taxes, but I know I owe. Am I eligible for the Clean
Slate '08 program?
Yes, if the taxes are due for any tax period(s) ending before January 1, 200S, you are eligible.
You will need to file all delinquent returns and submit full payment to OTC postmarked prior to
or on November 14, 200S.
Do I have to be an Oklahoma resident to be eligible for Clean Slate '08?
No. All taxpayers, wherever they reside, are eligible.
How to Participate
How do I take advantage of Clean Slate '08?
By mail.
�� OTC: Clean Slate 'OS
Post Office Box 269059
Oklahoma City, OK 73126-9059
By internet.
· www.cleanslateOS.org
By telephone.
· I-S77-320-7612
In person.
· See locations listed below.
What do I need to do?
Call the Clean Slate 'OS hotline to speak to a Clean Slate '08 representative.
· File any missing returns for those tax periods for which you applied for Clean
Slate 'OS.
Submit payment to aTC postmarked prior to or on November 14, 200S.
Set up a Clean Slate '08 payment plan by November
14,2008 and pay the taxes in full according to the plan.
May I file an extension for Clean Slate '08?
No.
22
What happens if I delay filing and paying past-due taxes until the Clean Slate '08 period
begins?
The state will continue its normal compliance, enforcement, and collection efforts to enforce the
Oklahoma tax laws. It also means that normal billing and collection actions will continue. This
could result in garnishments of wages, audits, litigation and other actions allowed by law.
How To Pay
When must I pay?
You must pay your Clean Slate '08 balance by November 14, 2008. If you cannot pay by this
deadline, you may set up a Clean Slate '08 payment plan between September 15 and November
14, 2008, and pay the taxes in full according to the schedule established by the plan.
What payment methods are available?
Several payment options are available to taxpayers. These options include:
• Check,
• Electronic Check (e-check),
• Credit Card,
• Money Order,
• Cashier Check,
• Cash, and
• Wired Payments.
Which of the OTC offices will accept payments?
· The main office in Oklahoma City;
Tulsa Metro office;
· Ardmore area office; and the
· Lawton area office.
May I pay the amount I owe for the Clean Slate '08 period to the collection agency that
currently has my tax liability(s)?
Yes, if you are in a payment plan arrangement or in a wage garnishment with a current OTC
collection agency, you must contact that collection agency directly. If you are not currently in a
payment plan arrangement or in a wage garnishment, you must follow Clean Slate '08
procedures.
Payment Plan Options
Who is eligible, and how does it work?
Call the Clean Slate '08 hotline between September 15 and November 14, 2008 to speak to a
representative who will explain all payment plan options available.
23
How do I apply for a Clean Slate '08 payment plan?
Call the Clean Slate 'OS hotline between September 15 and November 14, 200S to speak to a
representative who will assist you in making application.
Will the time period for payment plans be extended past the deadline within the plan due
to special circumstances?
There are no provisions to extend the payment period past the deadline.
What happens if I have a Clean Slate '08 payment plan and miss a payment or I am late
with a payment?
You will have defaulted on the terms of the payment plan and are no longer eligible for Clean
Slate 'OS.
I currently have a payment plan with the OTC or one of their selected members. Do I have
to participate in the Clean Slate '08 program?
No, you are not required to participate. However, you may choose to participate in order to
eliminate all penalties, interest and collection fees that are still due.
Miscellaneous
I paid all or part of my penalty prior to September 15, 2008. Will you waive the penalty I
paid and refund the penalty payments to me?
The law does not allow for payments made before September 15, 200S or after November 14,
200S to receive the benefit ofthe Clean Slate 'OS program.
Can Clean Slate '08 be revoked?
Yes, for those who do not fulfill their Clean Slate 'OS obligation.
24